Good morning, ladies and gentlemen, and thank you for waiting. At this time, we would like to welcome everyone to Adecoagro’s Fourth Quarter 2021 Results Conference Call. Today with us, we have Mr. Mariano Bosch, the CEO, and Mr. Charlie Boero Hughes, CFO. We would like to inform you that this event is being recorded, and all participants will be in listen-only mode during the company’s presentation. After the company’s remarks are completed, there will be a question-and-answer session. At that time, further instructions will be given. [Operator Instructions] Before proceeding, let me mention that forward-looking statements are based on the beliefs and assumptions of Adecoagro’s management, and on information currently available to the company. They involve risks, uncertainties, and assumptions because they relate to future events, and therefore depend on circumstances that may or may not occur in the future. Investors should understand that general economic conditions, industry conditions, and other operating factors could also affect the future results of Adecoagro, and could cause results to differ materially from those expressed in such forward-looking statements. Now, I’ll turn the conference over to Mr. Mariano Bosch, CEO. Mr. Bosch, you may now begin your conference.

Good morning, and thank you for joining Adecoagro’s 2021 fourth quarter results conference. Once again, in 2021, the company has delivered strong operational and financial results, as you may have seen in our report. In numbers, we made records sales in excess of $1 billion, almost $440 million in adjusted EBITDA, and generated over $150 million in adjusted free cashflow from operations. Also, as anticipated throughout the year, we distributed part of the research generated back in 2020 to our shareholders via our share buyback program. During 2021, we repurchased 6.2 million shares, more than 5% of the equity of the company. In 2022, as part of our distribution policy, we will distribute $35 million in dividends, and continue repurchasing shares under our buyback program. Now, I would like to give you some highlights on the results of the different business segments. In our farming business, during 2021 we produced over 1 million tons of grains that we conditioned and shipped to different customers across the world. In our dairy operation, we reached a record high production of half a million liters of raw milk per day, that we process in our own facilities to produce high quality value-added products, which are demanded both in the domestic and export markets. In our sugar, ethanol and energy business, we achieved crushing volumes in line with the previous year. The high degree of flexibility we have in our mills to produce the product with the highest marginal contribution, and the strategic decision to maintain our hedging level flow, allowed us to maximize returns. Our sustainable production model includes recycling of byproducts like the concentration of vinasse that is transformed into fertilizer, replacing approximately 35% of our needs. This had an important impact in 2021 to mitigate the overall increase in production costs.…

Thank you, Mariano. Good morning, everyone. Let's start on Page 4 with a brief analysis on the rains in Mato Grosso do Sul. As seen on the top tables, rains in our cluster during the fourth quarter of 2021, were 4.3% lower than during the same period of last year, and 15.6% below the 10-year average. After a very humid month of October, starting in November, rains in our region were lower than the average for this time of the year. It is worth pointing out that the March rains have returned to average levels, favoring the recovery of our sugarcane plantation. As we had anticipated here, diverse weather conditions that impacted Brazil's main productive areas throughout the year, caused a reduction in sugarcane availability towards year-end, resulting in an early start of in the harvest season for all players in Brazil’s sugar and ethanol industry. Thus, expectations for the 2021 and ‘22 season point a total sugarcane production of $525 million compared to the $608 million tons in the previous harvest year. Evidently, the reduction in supply generated a positive impact in the prices of sugar and ethanol, which we were able to capture thanks to our production flexibility and through our hedging strategy. Before turning to the following slide, I would like to briefly comment on our expectation going forward. Although current weather conditions in our cluster are good, we foresee below average agricultural productivity indicators during the first semester of the year, given the lagging impact of 2021’s adverse weather. Nevertheless, our recovering productivity towards the second half, along with strong prices, should continue to drive solid results. We are in a good position to keep on capturing the increasing prices, as 76% of our expected sugar production, and 100% of ethanol production relating to the ‘22…

[Operator Instructions] Today's first question comes from Isabella Simonato with Bank of America. Please go ahead.

Thank you. Good morning, everyone. Good morning, Mariano, Charlie. Thank you for the call. I have two questions, first of all on sugar and ethanol more on the cost side. We saw a big increase last year, which I understand has a combination of various factors, including the area extension, right? Could you give us some color, what do you expect in terms of area growth in the 2022, 2023 season? And on your mill unit phases, right, how much cost should increase in the next crop season as well? Just to understand how this crop space will continue moving forward. And the second question on the farming side, I think you provided some color, right, about the weather impacts in La Niña. And at this point, the planting is pretty much concluded and harvesting is beginning. Is it possible to quantify any potential downside in terms of yields, or can we assume something similar this season compared to the last one? Thank you.

Okay. Thank you, Isabella, for your question. I’m going to ask Renato give you more color on the crop on the sugar and ethanol and what are our plans and the area growth. So, Renato, can you give more color there?

Okay. Thank you, Isabella for the question. As was mentioned in the - by Charlie and Mariano, we will have a first semester very challenging in terms of sugarcane use because of the frost last year, but our sugarcane is looking very well for next year. We don't have any wheat problems, no plagues. The sugarcane foods are very well. The nutrition of the sugarcane foods are very good. We have planted a lot of sugarcane that's going to be harvested in the second semester. So, it should be a lot of cane - sugarcane could be harvested in the second semester. So, we think that it is going to be more than sufficient to compensate this lower productivity in the first semester. And we are going to end up - crushing is likely higher this year compared to less year. Regarding the increase in the area, we are going to increase a possibly 9,000 hectares, which was the expansion planting that we did last year. But we don't think that we will have a cost increase in those area because we expect that our yield this year is going to be likely higher than last year. So, we think that the over group of our sugarcane situation, the second semester probably will catch up the gap that we had in the first semester, because we are starting the crushing season in early March. We have already started in Angelica, and we will start in Ivinhema in few days.

Got it. Just to make sure I understood correctly. So, the cost per unit, right, that we saw grow 30%, if I'm not mistaken last season, should be largely flat in 2022, ‘23, even considering the area expansion. Is that it?

Yes, that's exactly because we are going to have a higher yield this year compared to last year. And we don't expect the same amount of increases in agriculture inputs that we had last year. And I think as Mariano mentioned before, we had some advantage in terms of cost. I think the concentrated vinasse, which is our bio fertilizer, which we have a plant in Ivinhema and Angelica, that is able to produce all the potash fertilizer that we consume, it represents a saving of approximately 1,000 AIs per hectare. So, it's a lot of savings that you have in the fertilizer line. Also, we have other things that is going to help a lot as the increase in our (indiscernible) with MPB planting. Actually, we have a (bio fabric) - (bio factory), sorry, in Angelica that we can produce 26 million seeds of MPB, which is enough to plant between 16,000 and 20,000 hectares with a much lower cost than a traditional plant. So, we are confident that we are not going to have increase in costs as we had last year.

Thank you, Renato. Isabella, to answer the second part of your question regarding the weather in Argentina and Uruguay, and how the crops are looping, I would say that we are in the middle of the season. So, we have already planted 100%, and we have already planted with an excellent situation. So, the planting is all very well done with all the fertilizer, all the chemicals, everything has been applied on time. And so, the crops, I would say that are looking very well. Of course, there are different climatic situations all over our very well diversified crop situation. And within this very well diversified crop situation, I would say that in general, we expect to be within the average of the years. So, we are continuing to watch it on average year. Within this average year, I would say that rice would probably be some way below the - what happened last year. Maybe corn and soybean may be a little bit higher than what happened last year. So, in general, I would say, average is the answer. And we are still in the middle of the process. We just started harvesting. All the harvesting that we started in rice and flour, et cetera, are doing well, but I would summarize on this situation where we are, average as we are starting the harvest.

That's very clear. Thank you very much.

Thank you. And our next question today comes from Thiago Duarte with BTG Pactual. Please go ahead.

Thank you. Good morning, everybody. Mariano, Charlie, Renato. Yes, two questions on our side here. The first one, it's actually a follow up on - with Renato on the discussion regarding sugar and ethanol, sugarcane yields, actually. Renato, can you quantify a little bit more to us on the yield improvement that you expect for the year? I understand that you still expect below average yields for the first half of 2022 on the back of the - of lingering effects from last year's drought. We have an improvement in the second half of the year. But can you give us a sense of how much of an improvement if you think of the balance of the year you're looking for? When we think of the center-south, we are hearing improvements from 5% to 10% in yields across the center-south of Brazil. So, just wanted to position where you expect to be within or outside this range. It would be nice to have. And the second question, also going back into farming, particularly in Argentina, I just wanted to hear your thoughts on, there was this news this week regarding bans on exports of soybean mill and oil. And just - so just wanted to hear from you whether you think this could sort of anticipate higher export taxes or (reconsiones) on soybean for the coming crop. It would be nice to hear as well. Thank you so much.

Okay. Thank you, Thiago, for your questions. Renato, do you want to answer the first question?

Hi, Thiago. Thank you for our question. I think we are in the same line of the center-south. We are expecting to have an increase in mills between 5% and 10%. And I think all the efficiency hat we have in the sugarcane supply, and also at our mills, will be enough to crush more sugarcane in a shorter period of time. So, we're going to crush more - likely more this year than less year, but regarding the yields, we are in line with the rest of the center-south.

Thank you, Renato. And regarding your second question on Argentina, this export taxes or potentially increasing export taxes, that's something that is a discussion that starts because of this huge increase in the commodity prices. And that's something that usually happens, the discussion about this. The reality is that the government can only increase 3% of the export taxes without going to Congress. So, the possibility is only 3%. And what we hear yesterday from the government officials is that they are not going to increase this 3% that they could do. So, we really don't know what's going to happen, of course, but if it happens, it's only a 3% increase, and it a 3% increase in this export taxes on soy, corn, and wheat, the maximum potential. That means around 10% of our total sales, and of which 30% have already been sold or hedged. So, the impact in our particular P&A is relatively low if that happens. But I would say that, of course, there is a possibility. I personally probably don't think that will happen in the three products.

That's very clear. Thank you, Mariano. Thank you, Renato.

And ladies and gentlemen, our next question today comes from Lucas Ferreira with JPMorgan. Please go ahead.

Hi. Good morning, everybody. So, my first question, Charlie, is on the distribution policy. So, you're committing with that 40%, but my question is simple is, when do you guys analyze like a further room in the balance sheets, given the free cashflow generation you should be generating in 2022, where you guys should get a strong one. When do you analyze there could be a potential for increasing that amounts over the year? Can you remind us if it could be like extraordinary payments throughout this year? That's my first question. And the second question, it's one - I don't ask much on you guys about this one, but on rice, what - do you think that what's going on with overall agricultural prices, with especially wheat, soybeans, and corn, could also push rice prices up? I think we haven't seen such an important move in the prices, but if you can update on that one, if we should expect on the back of overall higher costs and higher grain prices, if rice prices should also be - should be benefiting from that environment. Thank you.

Thank you, Lucas, for your questions. Regarding our distribution policy, as you said, it's very clear that it is at least 40%. And we have this capital allocation strategy where we are very comfortable now that we have these sustainable cash flows, and that we are having enough free cash from operations to always comply this policy, and also continue to pursue some growing opportunities that are synergizing what we are currently having. So, as you can see, during last year, we distributed 50% of the net cash from operations. This year, we are talking about at least 40%. Of course, this could potentially be higher, but that will depend on the different opportunities, on the different prices of the shares, and what would be going on during the year. So, our compromise is very clear and will be maintained. And that is something that we've been talking about since we announced our five-year plan. That was back in 2017. And so, from - in 2017, we mentioned very clear that 2021 was the first year where we were going to start distributing to our shareholders. And in 2021, we distributed five - more than 5% of the equity of the company through our share buyback program. So, this year, we are very confident that we will continue with the same line and increase. Then going back to the second part of your question regarding rice and potential increase in price, in general, rice, peanuts, sometimes sunflower, sunflower in the particular year, has grown a lot more because of what's going on in one of the regions that are the main producers of sunflower. But in general, they take more time to increase and decrease than the products that are more liquid like corn and wheat, as you were mentioning. So, today, we are already seeing an increase in prices of rice in general, and that's something that is happening as we speak. When we started the year and we saw increasing in wheat, rice was not increasing yet, and now rice is already increasing. So, we would expect that rice and peanuts will always - will also increase in line with what's going on with the rest of the commodities.

Great. Thank you very much.

Thank you. And ladies and gentlemen, this concludes the question-and-answer session. At this time, I'd like to turn the floor back to Mr. Bosch, for closing remarks.

Thank you very much, everyone, for your participation. See you in our next calls.

And ladies and gentlemen, this concludes today's presentation. You may disconnect your line at this time, and have a wonderful day.